The Supreme Court (SC) has denied the petition filed by the Chamber of Customs Brokers, Inc. (CCBI) to declare unconstitutional the provision in the 2016 Customs Modernization and Tariff Act that limits the power of customs brokers in the declaration of exported or imported goods. 

In a decision written by Associate Justice Antonio T. Kho Jr., the SC affirmed the 2020 ruling of the Court of Appeals which upheld the order issued by the Manila regional trial court (RTC) in 2029.

The RTC dismissed the petition for declaratory relief filed by CCBI, a national organization of customs brokers recognized by the Professional Regulations Commission. The CA affirmed the dismissal.  

Under Section 27 of the 2004 Customs Brokers Act, “any single act or transaction embraced within the provision of Section 6 hereof shall constitute an act of engaging the practice of customs broker profession. Import and export entity declarations shall be signed only by customs broker under oath based on the covering documents submitted by the importers.”

On the other hand, Section 106 of the Customs Modernization and Tariff Act of 2016 under RA 10863 provides: “A declarant may be a consignee or a person who has the right to dispose of the goods. The declarant shall lodge a goods declaration with the Bureau and may be … a person duly empowered to act as agent or attorney-in-fact for each holder.”  

CCBI claimed that Section 106 (d) of RA 10863 did not repeal or amend RA 9280 as there were no irreconcilable inconsistencies between them. Thus, it said, the provision in RA 10863 should be harmonized and read in conjunction with the provisions of the former law.

It pointed out that “allowing any person designated as an agent or attorney-in-fact of the importer or exporter to perform acts that would otherwise be limited only for licensed customs brokers created undue favor and inequality.”

The Bureau of Customs (BOC) through the Office of the Solicitor General (OSG), said that Section 27 of RA 9280 has been modified by Section 106 in relation to Section 107 of RA  10863.

BOC said that the new law authorizes the importer, exporter, as well as their appointed agent or attorney-in-fact, to lodge a goods declaration independently and without the participation of a customs broker.

It also said that RA 10863 has a repealing provision – Section 1803 which states: "All other laws, acts, presidential decrees, executive orders, rules and regulations or parts thereof inconsistent with the provisions of this Act are hereby expressly repealed, amended or modified accordingly."  

At the same time, BOC said that even before the enactment of RA 10863, Section 27 of RA 9280 had already been amended by Section 1 of  RA 9853.  The amendment provided that import declarations should  be signed by both a customs broker and the consignee/owner/importer, while export declarations are to be signed by the exporter, or, at his option, a customs broker or authorized representative.

In denying CCBI’s petition, the SC reminded that RA 10863 was enacted in 2016 in response to the Philippines’ obligations under the Revised Kyoto Convention which seeks balance between customs functions of control and revenue collection and trade facilitation.

The SC did not give credence to CCBI’s claim that Section 106 (d) of RA 10863 violates the equal protection clause under the Constitution.

“As regards petitioner's contention that Section I06 (d) of RA I0863 violates the equal protection clause, suffice it to say that the CA correctly ruled that petitioner failed to substantiate such contention,” the SC said.

It said that the equal protection guaranty under the Constitution means that “no person or class of persons shall be deprived of the same protection of laws which is enjoyed by other persons or other classes in the same place and in like circumstances.”

But, it said, such guaranty “does not demand absolute equality;” rather it merely requires that persons under like circumstances be treated alike.

It pointed out that the equal protection clause “was not intended to prohibit the legislature from enacting statutes that either tend to create specific classes of persons or objects, or tend to affect only these specific classes of persons or objects.”

“A law is not invalid because of inequality. The very idea of classification is that of inequality, so that it goes without saying that the mere fact of inequality in no manner determines the matter of constitutionality,” it stressed.

It reminded that “when the due process and equal protection clauses are invoked, considering that they are not fixed rules but rather broad standards, there is a need for proof of such persuasive character as would lead to such a conclusion. Absent such a showing, the presumption of validity must prevail.”

“Here, no concrete evidence and convincing arguments were presented by CCBI to warrant a declaration of the unconstitutionality of RA 10863,” it said.

Thus, the SC ruled that “RA 10863 does not violate CCBI’s right to the equal protection of the laws.”